(Bloomberg) -- Hulu is lowering the price of its entry-level, ad-supported online TV service by 25 percent to $6 a month -- a week after Netflix Inc. raised prices.
The on-demand video service, which features over 85,000 episodes of shows such as “The Good Doctor” and “The Handmaid's Tale,” is keeping the price of its ad-free product the same at $12 a month. The changes take effect Feb. 26, the company said Wednesday.
In cutting the price of its basic plan, Hulu is drawing distinction between itself and Netflix, which only last week raised its most-popular plan by $2, to $13 a month. Walt Disney Co., AT&T Inc. and Comcast Corp. are all developing their own streaming services, underscoring the growing competition in streaming.
Hulu, based in Los Angeles, is owned by Disney, 21st Century Fox Inc., Comcast and AT&T, although Disney is set to gain majority control after it completes its $71 billion acquisition of Fox's entertainment businesses in the next few months. Disney Chief Executive Officer Bob Iger has said he's interested in acquiring the rest of Hulu.
Hulu has announced promotional discounts before. In 2017, shortly after another Netflix increase, Hulu also lowered its price on a temporary basis to $6 a month. The offer was available for three months. Hulu said the new low price doesn't have a planned expiration.
Its cable-TV alternative, Hulu + Live TV, will rise by $5, to $45 a month. That service includes local stations, such as ABC and Fox, as well cable TV channels like HGTV and the Discovery Channel.
Hulu said earlier this month that it had 25 million subscribers, a 48 percent increase from the prior year.
To contact the reporters on this story: Christopher Palmeri in Los Angeles at cpalmeri1@bloomberg.net;Gerry Smith in New York at gsmith233@bloomberg.net
To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, Rob Golum
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